Thursday, June 21, 2012
Thursday, June 21, 2012
The Counsellors Ltd hosted the fifth annual Financial Voice forum at the J Whitney Pinder Building in Nassau on June 19.
The panel discussion was held under the theme “Examining the National Budget and the State of the Economy.”
The panelists were: Gowon Bowe, partner at PricewaterhouseCoopers; Dr Robin Roberts, director at University of West Indies School of Clinical Medicine and Research–The Bahamas; Hubert Edwards, a senior manager at Bank of Bahamas; Chamber of commerce chairman Chester Cooper; president of The Bahamas Hotel Association (BHA) Stuart Bowe; real estate entrepreneur Chris Mortimer; and Rupert Pinder, an economist and assistant professor at The College of the Bahamas.
The moderator was attorney and media personality Jeffrey Lloyd.
The discussion got underway with a broad look at the state of The Bahamian economy.
“Even though we’re at 16 per cent unemployment, we feel the economy has bottomed out and is recovering,” noted Cooper, but went on to say that the budget needed “more creativity.”
Edwards from the Bank of Bahamas added: “Our budget problems require creative solutions. The Bahamian economy is at a crossroads. The debt to GDP [gross domestic product] ratio is a big issue.”
However, Stuart Bowe was upbeat about the state of the tourism industry, saying: “Tourism is going well. We are seeing bookings at pre-recession levels now and I’m glad to see an emphasis [in the budget] towards Grand Bahama and the Family Islands. The [efforts to improve the economy] of Grand Bahama are critical to the tax base.”
On the matter of tax reform, several members called for the introduction of a Value Added Tax (VAT) as a practical solution for raising revenue.
Cooper, however, said that greater efforts to bolster the economy were preferable to raising taxes.
“We need to create a bigger pie by expanding the economy. We haven’t created any new industries in The Bahamas since the 1960s,” he said. “We need a comprehensive plan to develop the economy. A longer term plan. The national budget is a short-term tool.”
Several panelists called for further diversification in the economy, but economist Pinder warned that this too has its drawbacks.
“There is a cost to diversifying the economy. It can cause harm to established businesses,” he said. Instead, he advocated extending the reach of existing lineages of the economy, such as tourism and financial services. “The US accounts for most of our tourism, but there is tremendous potential in other markets.”